MC Mining Limited (Coal of Africa)
MC Mining Limited (Coal of Africa)
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South African-focused MC Mining continues to assess the full effect of changes including the transition to owner-operation at its Uitkomst Colliery after posting March qtr (Q3FY19) ROM coal production of 113,190t, compared to 112,562t in the previous period.
Higher yields and favourable exchange movements improved production costs to $US50/t (Q2FY19: $74/t).
Sales of metallurgical and high quality thermal coal were 70,271t (67,606t) at revenue of $75/t ($91.25/t).
MC Mining remains on track to start phase 1 construction of its 69%-owned Makhado hard coking and thermal coal project in the Limpopo province after the South African govt dismissed an appeal against its amended environmental approvals.
CEO David Brown says the rejection of the latest attempt by “narrow interest groups” to halt the project reinforces the robustness of the permitting process for the planned initial 2Mtpa ROM coal operation.
Well-publicised issues with the transition to owner-operation at its Uitkomst thermal and metallurgical mine in KwaZulu Natal have lowered South African miner MC Mining’s ROM coal production to 237,715t for the 6 months to Dec 2018 (H1FY19), from 265,699t a year earlier.
Coal sales fell to 163,487t (H1FY18: 308,275t), comprising 157,452t ROM coal and 6,035t third party purchases.
Favourable coal prices assisted Uitkomst generate EBITDA of ZAR46.3M (ZAR45.2M).
MC’s overall loss for the period was $US3.6M ($97.3M).
MC Mining is aiming for a Sept qtr construction start on the first phase of its 69%-owned Makhado hard coking and thermal coal project in South Africa’s Limpopo province.
After a 12-month delay due to land access issues, Australian-based MC has adopted a phased development approach starting with the mining of 3Mtpa ROM coal from Makhado's west pit for processing at the modified Vele processing plant to deliver saleable product of 0.54Mtpa hard coking and 0.57Mtpa thermal (5,500kcal) coal.
Equipment and operational issues relating to its switch to operator-mining have dragged Dec qtr (Q2FY19) ROM production at MC Mining’s Uitkomst colliery in KwaZulu Natal, South Africa to 112,562t, down from 125,153t in Q1.
It says equipment availability issues, managing the incorporation of ex-contractor employees and process challenges cost several shifts during the period.
The company anticipates corrective measures will lift Q3 production.
South African-focused MC Mining has made a key step towards unlocking value from its coking and thermal coal assets with the grant of a mining right for its 74%-owned Chapudi project in the Limpopo province.
Chapudi and the Mopadi and Generaal projects comprise MC’s longer-term Greater Soutpansberg Project in the Soutpansberg Coalfield, close to the Musina-Makhado Special Economic Zone. Mining rights for Mopane and Generaal are anticipated soon.
A long hunt is ending for additional land required for its Makhado hard coking and thermal coal project in South Africa’s Limpopo province is ending for MC Mining, which has finally finalised terms to acquire two key properties for R70M.
MC’s subsidiary Baobab Mining & Exploration has tried legal avenues and commercial negotiations to acquire the Lukin and Salaita properties from a privately owned company that operates them as commercial game farms.
South African-focused miner MC Mining has lifted Sept qtr (Q1FY19) metallurgical and thermal coal production from its Uitkomst colliery in KwaZulu Natal to 125,153t (Q4FY18: 123,771t). Third-party coal purchases were 12,446t (13,625t).
Uitkomst transitioned to owner-operation with the acquisition of independent contractor Khethekile’s mining operations following its challenges with mining contractor equipment availability in the previous period.
South African-focused MC Mining has signed its first coal purchase agreement for the Makhado hard coking and thermal coal project in Limpopo province.
Chinese state-owned commodity trader and logistics group Huadong Coal Trading Center will acquire at least 400,000tpa hard coking coal over 3 years.
The deal represents half of Makhado’s forecast 800,000tpa hard coking coal. The mine will also produce up to 1Mtpa export quality thermal coal.
Global construction giant China Railway Group has signed funding, construction and mining HOAs with MC Mining for its 100%-owned Makhado hard coking and thermal coal project in South Africa’s Limpopo province.
International arm CRIG will negotiate on a package of contracts covering EPC for the Makhado coal handling and preparation plant, financing for 85% of the EPC costs and contract mining operations.